[Click eStock] "LS, Strong Earnings Momentum Thanks to Stable Price"

NH Investment & Securities Presents 'Buy' Investment Opinion and Target Price of 93,000 KRW... Closing Price on 14th at 72,800 KRW

[Asia Economy Reporter Kum Boryeong] An analysis suggests that LS's fourth-quarter performance last year will show a strong trend, supported by the strength of copper prices.

According to NH Investment & Securities on the 15th, LS's fourth-quarter results last year are estimated at sales of 2.7624 trillion KRW and operating profit of 141.9 billion KRW. Compared to the previous year, sales increased by 2%, and operating profit rose by 331%.

Dongyang Kim, a researcher at NH Investment & Securities, explained, "Despite the decline in exchange rates, the continued strength of copper prices creates a positive environment. Strong orders for ultra-high voltage cables and recognition of deferred sales are expected to boost LS Cable & System's performance. Through the impact of strong copper prices, LS I&D and LS Nikko Copper Smelting, which benefit from by-product income, also appear to have solid results."

As copper prices continue to strengthen, the performance of LS's major subsidiaries, which use copper as a primary raw material, is rapidly improving. Researcher Kim said, "Copper prices have reached the highest level since 2012," adding, "There is a high correlation between copper prices and LS's stock price."

The outlook for this year's performance is also positive. Copper prices have continued to rise since the beginning of the year, and operating profit in the first quarter is expected to show strength. Researcher Kim analyzed, "With the government's commitment to the Green New Deal and expansion of offshore wind power, and the completion of the Donghae Plant 2 to respond to strong overseas demand, LS Cable & System's submarine cable growth will accelerate. LS I&D is expected to grow operating profit by 17% year-on-year to 528.4 billion KRW this year through the establishment of a joint venture with Japan's Furukawa Electric for EV winding."

NH Investment & Securities gave LS a 'Buy' investment rating and set a target price of 93,000 KRW. The target price was raised from the previous 72,000 KRW. The closing price on the 14th was 72,800 KRW.